Palo Alto, California – Toyota Motor Corporation and Tesla Motors have announced that they intend to cooperate on the development of electric vehicles, parts, production systems and engineering support, with Toyota agreeing to invest US$50 million in Tesla.

The two companies intend to form a team of specialists to further the efforts. Toyota has agreed to purchase $50 million of Tesla’s common stock issued in a private placement to close immediately subsequent to the closing of Tesla’s currently-planned initial public offering.

“I sensed the great potential of Tesla’s technology and was impressed by its dedicated to monozukuri (Toyota’s approach to manufacturing),” said Toyota president Akio Toyoda. “Through this partnership, by working together with a venture business such as Tesla, Toyota would like to learn from the challenging spirit, quick decision-making, and flexibility that Tesla has. Decades ago, Toyota was also born as a venture business. By partnering with Tesla, my hope is that all Toyota employees will recall that venture business spirit, and take on the challenges of the future.”

Last year, Toyota started leasing the Prius plug-in hybrid, and also plans to introduce electric vehicles into the market by 2012, while Tesla’s goal is to produce increasingly affordable electric cars to mainstream buyers and relentlessly drive down the cost. Tesla has delivered more than 1,000 electric Roadsters to customers in North America, Europe and Asia, designs and manufactures electric vehicles and powertrain components, and is currently the only automaker in the U.S. that builds and sells highway-capable electric vehicles in serial production.

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